Over the past few years, the Supreme Court has heard several cases involving class action procedure, including China Agritech, Inc. v. Resh; CalPERS v. ANZ Securities, Inc.; and Microsoft Corp. v. Baker. Today, the Supreme Court continued this trend, granting review to decide whether Rule 23(f)'s 14-day deadline to file a petition for permission to appeal an order granting or denying class certification is subject to equitable exceptions. Nutraceutical Corp. v. Lambert, No. 17-1094.
Lambert is a putative class action alleging that Nutraceutical violated California's false advertising and unfair competition laws in selling a dietary supplement with the colorful name "Cobra Sexual Energy." The district court initially certified a class, but then granted Nutraceutical's motion to decertify at the close of discovery, holding that the plaintiff had failed to present a model for class-wide damages that complied with Comcast Corp. v. Behrend.
The plaintiff did not seek review in the Ninth Circuit within 14 days of the district court's decertification order, as required by Rule 23(f). Instead, after that deadline had passed, the plaintiff moved for reconsideration, and the district court denied the motion. The plaintiff then filed a Rule 23(f) petition. After full briefing, the Ninth Circuit held that the petition was timely even though it wasn't filed within 14 days, reasoning that it had the authority to "soften" the Rule 23(f) deadline based on equitable considerations and concluding that plaintiff had acted diligently by informing the court orally of his intention to file a motion for reconsideration. (The Ninth Circuit also reversed and remanded the decertification order on the merits.)
The Ninth Circuit recognized that its holding on the timeliness issue conflicted with those of other Circuits. Indeed, as Nutraceutical's cert petition noted, seven other Circuits—every one to consider the issue—have held that Rule 23(f)'s deadline is strict and mandatory. Those courts have recognized a single narrow exception: When a motion for reconsideration is filed before the 14-day window to petition for appeal expires (not after, as in this case), the deadline is postponed pending the outcome of that motion.
Although this case arises in the context of a plaintiff's attempt to seek appellate review under Rule 23(f), the issue is not one that divides neatly along "pro-plaintiff" and "pro-defendant" lines. Defendants frequently seek review under Rule 23(f) of orders granting class certification, and (at least in theory) might benefit from the flexible approach to timeliness taken by the Ninth Circuit. In fact, the question presented really boils down to how appellate deadlines should work.
As the lopsided circuit split might suggest, we think the Supreme Court is unlikely to approve the Ninth Circuit's approach. In recent years, the Supreme Court has referred to a number of deadlines as "mandatory claims-processing rules" (whether they are jurisdictional or not). Those deadlines are supposed to be simple and clear, and so the courts have strictly enforced those rules unless the party who seeks to enforce the deadline has forfeited the right to do so. The Ninth Circuit's approach faces an additional hurdle because Federal Rule of Appellate Procedure 26(b)(1) generally allows courts to extend deadlines for good cause, but expressly provides that courts "may not extend the time to file . . . a notice of appeal (except as authorized in Rule 4) or a petition for permission to appeal."
Originally published June 25, 2018
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